Determine the breakeven point after expansion

Assignment Help Accounting Basics
Reference no: EM13509815

Analysis of an Expansion Proposal

The Enchantment Company is considering an expansion of its present facilities to meet an expected increase demand for its product. The company's current contribution margin ratio is 20 percent. The expanding proposal requires an increase of $50,000 in fixed costs. No changes in unit selling price and unit variable cost are expected for the coming year. The company is now breaking even at $300,000 of sales.

1. Determine the breakeven point after expansion.

2. If the additional facilities are provided, determine the expected profits for sales of $600,000 in the coming year.

Reference no: EM13509815

Questions Cloud

Identify an open source project management tool : Identify an open source project management tool that could be used as an alternative to Microsoft Project. Try provide a critical comparison of the two tools and evaluation of the technique used = 1000 words.
Statements about the louisiana purchase : Action Canada for Population and Development is committed to promoting their belief that, “Sexual and reproductive rights are a crucial and fundamental part of women’s full enjoyment of all rights as well as integral to gender equality, developmen..
Determine the values for the energy grade line : 4. Determine the values for the Energy Grade Line and the Hydraulic Grade Line for the tank and pipe system of problem 3. Plot the EGL and HGL.
How much is light from mercury redshifted : A distant observer, observing from far away but in the plane of the Solar System tries to measure the orbital speed of Mercury. How much is light from Mercury redshifted or blueshifted as it orbits the Sun
Determine the breakeven point after expansion : The Enchantment Company is considering an expansion of its present facilities to meet an expected increase demand for its product. The company's current contribution margin ratio is 20 percent.
Verify that the hazen williams equation : Verify that the Hazen Williams equation
What would be the total production engineering cost per unit : What would be the total production engineering cost per unit, both fixed and variable, at an activity level of 9,300 machine-hours in a month? Assume that this level of activity is within the relevant range.
Physical damage wrought by the dust bowl : Which of the following human practices amplified the physical damage wrought by the Dust Bowl?
Targeted plan in which you present your detailed strategies : Prepare a targeted plan in which you present your detailed strategies to recruit and select 20 Engineers to hire (full-time or part-time) within 8 months.

Reviews

Write a Review

Accounting Basics Questions & Answers

  Balance of the accumulated depreciation account

A change in estimate was made in 2011 to reflect these additional data. What amount should Wolverine record as the balance of the accumulated depreciation account for this machine at December 31, 2011?

  What should your company record as a gain from the sale

assume your company just sold a mainframe computer. The computer originally cost $300,000 and had accumulated depreciation of $100,000 on the date of the sale. Instead of the buyer paying cash, she gave you a $400,000 noninterest-bearing note due ..

  Cost of advertising and warehouse expense

What was the cost of advertising and warehouse expense allocated to each of the business based on the traditional method?

  What would capital reported on statement of owner equity

Based on this information, the balance in Hal Smith, Capital reported on the Statement of Owner's Equity at the end of March would be?

  Calculate the profit margin ratio and gross profit rate

Which cost flow method results in the highest inventory amount for the balance sheet? The highest cost of goods sold for the income statement?

  Your boss called you into the office and reprimanded you

corporation prepared the following performance report for variable overhead costs for the last quarter of the year.

  Determine the materials price and quantity variances for

one of the products of hearts amp flowers is a one-pound boxof chocolate candy packaged in a box bearing the customers

  Enviro company issues 8 10-year bonds with a par value of

enviro company issues 8 10-year bonds with a par value of 250000 and semiannual interest payments. on the issue date

  On september 20 20x1 ott purchased bonds issued by

on september 20 20x1 ott purchased bonds issued by buy-a-lot company with an amortized cost of 100 and a fair value of

  Determine the amount of cash to suppliers

A company recorded net purchases of $15.7 million for2007. In 2006, ending accounts payable was $1.4 million and in 2007, it was $1.9 million. How much cash was paid to suppliers in 2007?

  Calculate the financial ratios for assigned companys

calculate the financial ratios for the assigned companys financial statements and then interpret those results against

  Which of the following would result in the decrease in cash

which of the following would result in a decrease in cash flow and a use of cash?a. a decrease in notes payableb. an

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd